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Inside Look: Westfield Old Orchard

Rising revenue puts the mall on road to comfortable rebound, helping Skokie.

Now that summer is over, Westfield Old Orchard is preparing for the new year, and that means end-of-summer sales and a new fall lineup. But with numerous malls struggling with the economic recession, Skokie's flagship retail outlet finds itself in a comfortable position.

The mall currently has 120 stores, 20 restaurants and a professional building with 40 medical professionals.

Deborah Mattes, senior general manager, said the mall traffic hasn't been affected by the economy.

"We're cautious but optimistic," said Mattes, who has been in her position for three years. "Retailers are working really hard on business plans to not only address [their] plans … but [also] the economy."

People are still cautious in their spending, as the federal Bureau of Labor Statistics reported the national unemployment rate was 9.6 percent in August. Illinois' jobless rate has been running above that, hitting its highest mark of 12.2 percent in January 2010.

Chicago resident Jacquelyn Vance said her personal finances and the economy have both recently influenced her spending habits.

"I definitely don't buy as much as I used to," said Vance, who now shops at the mall about once a month. "I used to probably go once a week and get at least an outfit, or you know, some type of makeup, or hair product, and I've cut down on that quite a bit."

Like many municipalities, Skokie has felt the pinch. It experienced a sales tax rate increase in July, rising from 9 percent to 9.5 percent.

Finance director Bob Nowak said that the village receives 2 percent of the sales tax revenue, of which Old Orchard Mall accounts for about 40 percent.

Village of Skokie Manager Al Rigoni said the town has lost sales tax money over the past three years but sees a glimmer of hope.

"Of late, it's coming back a little bit," he said. "But the levels of revenue are still not back to where they were in the peak year, 2007."

Nowak said Old Orchard Mall, being "a destination for a lot of shoppers in the area," generated about $9.4 million from December 2005 to November 2006. However, he noted $8.1 million was generated from December 2008 to November 2009 -- a decrease of 13 percent.

As a result, Nowak said, the village's sales tax revenue went down 14.5 percent. Despite the revenue figure, he said he agrees with Mattes in noticing recent improvement.

Seven of the eight months between October 2009 and May 2010 showed revenue gains compared to the same period in the previous year. "After seven to eight months, in terms of recovery, it's too early to tell," said Nowak.

Cameo Galleria's owner and manager, Joseph Esfahani, said his store opened about 18 months ago in the mall and was doing better this year than last year.

"Downtown at our other location, we concentrate on fine jewelry, gold and [diamonds] and considering the economy, we decided to open this low-ticketed item line," he said.

Items in his mall store range from $20 to $500 and at least 60 customers visit the store each week, Esfahani said.

"I have noticed that more looks convert into sales," he said. "I would say more than 50 percent of people [who] visit our store end up buying something."

Joey Knox, who has worked at Armani Exchange since the 2009-2010 holiday season, has seen a decrease in shoppers throughout the mall.

"People's mindset is kind of overall different," he said. "They'll pay more attention to the value they're getting for their money. They'll always start in sales. You have to work them up to full price."

Knox also commented on the relationship among retailers in the mall. "I think the dialogue between retailers has increased," he said, noting they would call around to see if it was a bad day in general or just for their store.

"It's a lot more unpredictable, and I think part of it is the rate of return," Knox said.  "Like people won't get out of bed to shop, but they'll get out of bed to return something."

Knox notes that "amateur shopping day" still brings out the window shoppers, saying that "a lot of people that still enjoy walking around the mall, especially on Sundays. It's like a lot of browsers, lots of strollers."

"People still like being out and about," he said, "[but] less urgency to buy, I guess."


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